Post office fixed deposit interest rate is calculated on a quarterly basis and paid on an annual basis, according to India Post.

A fixed deposit (FD) is a financial instrument which offers guaranteed returns.

State Bank of India (SBI), country's largest lender, recently revised its fixed deposits rate. On fixed deposits below Rs. 1 crore, interest rates were raised between 5 basis points-10 basis points, which means between 0.05 per cent-0.1 per cent across tenures of 1 year-up to 10 years. Just like banks, post offices also offer fixed deposit and recurring deposit facilities. Recurring Deposit (RD) is a kind of deposit under which one needs to deposit a fixed amount at fixed intervals, which generates interest income. A fixed deposit (FD) is a financial instrument which offers guaranteed returns. In a fixed deposit account, money is deposited for a specific time, which varies from 7 days to ten years.

Here is a comparison of fixed deposit (FD) rates offered by State Bank of India (SBI) and India Post:

Recurring deposit or RD interest rates of SBI are the same as that on FDs. So, the above mentioned rates are also applicable on Recurring deposits.

India Post fixed deposit interest rates:

Post office FD interest rate is calculated on a quarterly basis and paid on an annual basis, according to India Post. The account can be opened with a minimum amount of Rs. 200. Any amount in the multiple of Rs. 200 can be invested in the scheme. The post office TD account has no stipulated maximum investment limit.

The following interest rates are from indiapost.gov.in:

Period

Rate

1 yr.A/c

6.60%

2 yr.A/c

6.70%

3 yr.A/c

6.90%

5 yr.A/c

7.40%

Post office recurring deposit account:

The post office RD account, known as the five-year post office recurring deposit account, offers an interest rate of 6.9 per cent. The recurring deposit can be set up with a minimum amount of Rs. 10 per month. In a recurring deposit, the investor deposits a fixed amount of money in regular intervals. Contribution in the multiples of Rs. 5 can be chosen to invest in the five-year recurring deposit account. The interest rate of 6.9 per cent is compounded on a quarterly basis, which means a recurring deposit account of Rs. 10, in which the account holder pays Rs. 10 every month, provides a return of Rs. 717.43 in the maturity period of five years, according to India Post.